By Katherine Hobson

The paper, citing people familiar with the matter, says talks are in the early stages and any acquisition is “far away.” The companies declined comment to the WSJ.

Genzyme’s shares were up more than 16% to $63.10 in late afternoon trading today. S&P raised its opinion on the company’s shares to buy from hold on the news and raised its target share price by $14 to $72.

The WSJ reports that Genzyme is looking for a price that “reflects the potential for a company turnaround,” not an opportunistic offer. The biotech’s shares have been battered amidst its well-publicized manufacturing problems.

Last year, a virus was found in Genzyme’s manufacturing plant in Allston, Mass., which caused a shutdown of the plant and a subsequent shortage of medicines for very rare genetic diseases. The company has since decontaminated and essentially remade the factory, but production still hasn’t returned to previous levels.

And the whole snafu has cost the company. As the WSJ reported last month, analysts estimate Genzyme’s lost revenue will hit about $1 billion. Plus the company paid a $175 million fine to the government and agreed to federal oversight as part of a consent decree with the FDA.

Amid all this turmoil, Genzyme was also targeted by two different activist investors — Carl Icahn and Ralph Whitworth. The company’s board issues seemed to end last month, when it seated two of Icahn’s proposed directors. In April it reached terms with Whitworth that gave him and someone of his choosing seats on the board.

Comments (1 of 1)

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